The current ratio concept is particularly useful in:
A)analyzing large firms
B)comparing the financial positions of firms of varying sizes
C)examining firms with large seasonal sales
D)comparing the financial structures of firms of varying sizes

Question

Quizplus · Accepted Answer

The current ratio is a liquidity ratio that measures a company's ability to pay short-term obligations. It is useful for comparing the financial positions of firms of varying sizes because it standardizes the measure of liquidity, allowing for comparison regardless of the firm's size.

The Current Ratio Concept Is Particularly Useful In